“Taxes”: The Authority must be notified of the rental of shops and apartments within 30 days

Dr. Fayez Al-Daba’ani, head of the Egyptian Tax Authority, called for financiers from natural persons who own a residential unit, a summer house unit, or a store, and rent any of them whether a fixed-term lease or a furnished lease, with the necessity to notify the competent tax office of that incident within 30 days.

He explants that the revenues generated from this lease are subject to tax on real estate wealth revenues, and failure to notify them exposes them to legal accountability in accordance with the provisions of the Unified Tax Procedures Law No (206) of 2020.

He adding that the real estate wealth tax is not new, but rather appeared on the surface recently as a result of the increase in rent cases and large amounts, according to Law 4 of 1996.

Real estate revenues

Al-Dabani indicated, in a statement yesterday, Tuesday, that according to Income Tax Law No. (91) of 2005, when calculating the tax on real estate wealth revenues, 50% of the revenues are calculated against costs and expenses.

He Pointing out that the tax rate is progressive and starts from 2.5% to 27.5% according to the level of net profit segments, pointing out that there is a fine imposed on unpaid tax at the credit and discount rate announced by the Central Bank on the first of January for the accounting year, plus 2%.

He explained that in the case of leasing, the real estate or housing unit is subject to both the real estate wealth tax and the real estate tax if the market value of the unit exceeds 2 million pounds, and the real estate tax is deducted within the costs that are deducted from the real estate wealth tax account.

Exemption from the tax return

The head of the Tax Authority confirmed that the financier is, accordingly, obligated to submit a tax return, and there is an exemption from submitting a tax return if the annual net rental income, whether furnished or for a limited period, is an amount that does not exceed the exempted segment.

It is currently 21,000 pounds, starting from the tax period that ends after 6/15/2023, and he is also exempt if he is an employee and has real estate wealth revenue and the total net income does not exceed 21,000 pounds.

We appeal to these financiers to comply so that they are not exposed to the violations stipulated in the provisions of the Income Tax Law No. 91 of 2005, and the Unified Tax Procedures Law No. 206 of 2020.

5 conditions that must be adhered to before renting your apartment

1- One year imprisonment and a fine ranging from 5 thousand pounds to 10 thousand pounds, for anyone who rents a housing unit without notifying the department located in the housing unit department.

2-   The department is notified of a copy of the lease contract and the national number of the Egyptian tenant, or a copy of the identity proof of the foreign tenant.

3- 72 hours is the maximum period during which the rental owner is allowed to be notified of the data of the new tenant so that he does not face a penalty of fine and imprisonment.

4-   Without prejudice to the rights of non-bona fide persons, in the event that a terrorist crime is committed and the property is used in it, the court shall order the confiscation of the property, funds, luggage, weapons, tools, documents and all tools used in the crime.

5- The Public Prosecution has the right, on a temporary basis, to close down any place where weapons of all kinds were manufactured or designed.